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Extend NMW legislation to self-employed, says Resolution

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Self-employed workers suffering from extremely low pay should be entitled to the National Minimum Wage (NMW), a charity has claimed.

The Resolution Foundation says about half of the 4.8 million people classified as self-employed are low-paid and earn less than £310 a week.

It said legislation enforcing the minimum wage should be extended to those struggling with low pay and job insecurity.

It found that one in five employees were classed as “low-paid” – earning less than two-thirds of the typical weekly wage of about £500. However, half were earning less than the £310 threshold.

Resolution says the Government should extend NMW to contractors and the self-employed, with fears that companies could find a loophole by reclassifying workers.

The report comes as part of the Matthew Taylor review of modern work practices.

Conor D'Arcy, of the Resolution Foundation, said: “While many [of the self-employed] are higher earners who benefit from significant flexibility, around half fall below the low pay earnings threshold of just £310 a week.

“The government can start by extending minimum wage protections to those self-employed people whose prices are set by a firm.

“This would mean that self-employed people in the gig economy would be given protection against extreme low pay for the first time ever”.

Mr D’Arcy added: “Many of those in the gig economy as it currently stands are likely to be ‘workers’, an employment status with greater rights than the self-employed, meaning they should already receive at least the minimum wage.

“Greater enforcement is needed to ensure these workers get the rights to which they are entitled.”